3D Systems increases offer for Stratasys, agrees termination fee for Desktop Metal
July 13, 2023
3D Systems, Rock Hill, South Carolina, USA, has announced a further enhanced offer to combine with Stratasys Ltd, following its initial bid submitted in May and an increased bid submitted later in June were rejected.
Under the revised offer, 3D Systems stated that each Stratasys share would convert into $7.50 in cash and 1.5444 shares of the combined company, representing ownership by the Stratasys shareholders of approximately 44% of the the combined company in addition to the approximately $540 million being offered.
The offer implies a value per Stratasys share of $24.07, based on 3D Systems July 12, 2023 closing share price, representing a 62% premium to the closing price per Stratasys share on May 24, 2023, the last trading day prior to the announcement of the proposed transaction by Stratasys with Desktop Metal. This would result in an implied value of approximately $28 per share and approximately $2 billion in total value, inclusive of $100 million in cost synergies.
The terms of the deal also stated that 3D Systems would pick up any Desktop Metal termination fees. It stated that the terms outlined in merger agreement, including the representations, warranties, covenants, closing conditions and termination rights, were designed to track those in the Desktop Metal merger agreement in order to offer Stratasys and its shareholders at least as much certainty as the Desktop Metal transaction.
President and CEO Dr Jeffrey Graves stated, “We have continued to pursue a friendly combination with Stratasys with the objective of maximising value for the shareholders of both companies. Multiple large Stratasys shareholders have reached out to inform us that they believe a combination of 3D Systems and Stratasys is the right path forward. This feedback affirms our conviction that we are doing right by shareholders today by offering exceptional value, certainty and transparency, and agreeing to pick up the termination fee that will be payable to Desktop Metal.”
“We have taken every step to improve the value, certainty and transparency of our proposal and look forward to constructively engaging with the Stratasys Board so that we can mutually pursue a transaction that will change the landscape of the Additive Manufacturing industry for the benefit of not only investors, but also employees and customers. We are taking this decisive action now to remove any reasonable doubt whether 3D Systems’ offer is likely to result in a superior proposal. While we believe our previous offers should have constituted a superior proposal, we are confident that this enhanced offer and signed merger agreement unequivocally constitutes a superior proposal to any other before Stratasys,” Graves added.
The full terms of the enhanced offer are outlined here.
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